Barbeque Nation Success Story and Case Study
Back in 2006, Indian foodies were familiar with the concept of a “buffet”. However, a man named Prosenjit Choudhury – the restaurant manager at Indore’s Sayaji Hotels – wanted to bring more innovation to the tables of customers who loved to dine-out every now and then.
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One day he was struck with an idea when some customers came complaining about appetizers being cold. He thought to himself, “Why not try a live grill?” Wanting to experiment with such an idea, he went straight to his then boss, Sajid Dhanani, who approved it without any second thought. The hotel enjoyed an overwhelming success with the launch of a “live-grill” counter, prompting Dhanani to come up with Barbeque Nation!
The Launch of Barbeque Nation
Although Sajid Dhanani hailed from Bangalore, he decided to launch the first outlet of his ambitious project in Pali Hill, a posh locality in Mumbai.
The first outlet was a smashing hit, and by the end of 2008, Barbeque Nation had expanded with as many as 13 restaurants in major cities such as New Delhi and Bengaluru. Interestingly, the food chain hasn’t seen even a single shutdown even after more than 15 years.
The reasons behind the success of Barbeque Nation
Barbeque Nation can’t dedicate its overwhelming success to any particular point. Multiple reasons have come into play to take it to the peak of success. Some of them include:
Barbeque Nation doesn’t always look to open an outlet in ‘rich’ locations. You may find an outlet in any ordinary shopping mall and street. Because of this flexibility, the restaurant has been able to maintain a decent rent to revenue ratio. In fact, their rent:revenue ratio is 10% lower than other casual dining places.
Barbeque Nation has always made sure that they don’t go too over-board with their pricing. In 2006, the price for the live grill and a full buffet was kept at INR 450/person. Twelve years later, the price is still highly affordable at INR 599/person.
3) Targeting customers in small cities
Barbeque Nation isn’t just limited to metro cities. They have their outlets in far-away places like Jammu and Guwahati as well. In fact, they have been aggressively targeting tier-2 and tier-3 cities since 2016.
Reportedly, by the end of 2016, the company had launched 64 more outlets in cities such as Meerut, Madurai and Tirupur. Thanks to this move, Barbeque Nation’s turnover has seen a sharp growth. Its profits grew from INR 4.3 crore in FY-2013 to INR 10.2 crore in FY-2017.
4) Taking Customer Feedback Seriously
Customers are the people who make or break a business. Keeping this thing in mind, the company takes feedback from 20%-25% of the tables within 24 hours, through an online link.
This feedback, which the company refers to as the “Guest Satisfaction Index”, is visible to all team members, regional managers, the CEO and the managing directors. Once a customer leaves a negative review, the regional manager talks to them in person so that the issue can be resolved at the earliest – even for other customers. If the regional manager is unable to resolve the concern, the CEO gets in touch with the customer.
5) Presenting the local flavour
In an interview, the present CEO of the firm, Kayum Dhanani – who took control over the business after the demise of his elder brother Sajid in 2012 – said that they were initially struggling with their Lucknow outlet as customers didn’t like the taste of their biryani. Soon they realized that the “Mumbai-style” biryani that they were making was not appealing to the people in Lucknow. As a result, the company hired a local chef who understood the local taste very well and delivered exactly what people were seeking.
6) International Expansion
Barbeque Nation is not just limited to India. It has outlets in the Middle East and North Africa as well. The company is generating huge revenue in the former region as most of the countries in the Middle East do not levy any tax. Now the company is all set to enter Malaysia, Nepal, Sri Lanka and Bangladesh.
Going Public in March, 2021
Since 2018, the restaurant chain was looking to go public. In 2021, they finally made it with an INR 453 crore IPO. The price band for the IPO was set at INR 498 – INR 500 per share. It was stated that the proceedings from this issue would be utilized to
fund the restaurant chain’s capital expenditure for expansion, repayment of borrowings and to cover expenses for general corporate purposes.
No Shutting down
Barbeque Nation has been operating more than 130 outlets across the nation, and yet not even a single one has been shut down – a testimony to the profitability of the chain.
In an interview with Entrepreneur, the company’s CEO, Kayum Dhanani, said that 95% of their stores are profitable, and the remaining ones that are yet to make any money are the new ones, which may take anywhere from 6-12 months to break even.
Among the best companies to work
The “Great Places to Work” survey conducted by Economic Times in 2019 listed Barbeque Nation at the 13th spot in their list that covers workplaces in all categories. This goes on to show that this place is not only a huge favourite among diners but also a preferred place for work among the urban youth.
The same survey also listed Barbeque Nation among the top 10 employers within the Indian retail industry in 2019.
Many restaurant chains come and go, but it takes a great vision and an indomitable will to reach a position where Barbeque Nation is today. The restaurant chain has grown by leaps and bounds under the leadership of Kayum Dhanani, who is presently serving as the Managing Director (MD) of the company.
There was an immense pressure of expectations and performance when Kayum took charge of the restaurant chain after the demise of his brother Sajid, who founded the firm in 2006. Despite all the professional hardships, Kayum has indeed taken Barbeque Nation to the pinnacle of success.
With more retail outlets coming up across the world, Barbeque Nation’s success story and case study will be studied in-depth by up-and-coming entrepreneurs for years to come.